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2026 Supreme(Ori) 598

IN THE HIGH COURT OF ORISSA AT CUTTACK
A.C.BEHERA, J.
Santosh Kumar Naik – Appellant
Versus
State of Orissa represented through the Collector, Sundargarh and Others – Respondents
RSA No.69 of 2022 
Decided On : 20-02-2026

Advocates Appeared:
For the Appellant :Mr. P. Mukherji, Advocate
For the Respondents: Mr. Gyanaloka Mohanty, Standing Counsel.

The burden of proving impossibility under Section 56 of the Indian Contract Act lies with the party asserting it, and self-induced inability does not justify non-performance.

Headnote:(A) Indian Contract Act, 1872 - Section 56 - Suit for declaration and mandatory injunction - Plaintiff, an A-Class Contractor, challenged the termination of his contract after claims of impossibility due to Maoist interference - Courts upheld termination citing lack of evidence and duty on plaintiff to prove hindrance - Claims of impossibility found self-induced due to failure to notify defendants. (Paras 13, 17, 20)

(B) Contract Law - Impossibility of performance - The burden of proof to establish impossibility of performing a contract lies with the party claiming it, and self-induced inability does not relieve the contractee of their obligations. (Paras 19, 20)

Facts of the case:
The plaintiff was contracted for government works but faced threats and demands for money from local anti-social elements, which he claimed made it impossible to perform. Despite extensions, he failed to complete the works. He sought a declaration for termination of his contract due to these circumstances.

Findings of Court:
The courts found the plaintiff did not prove the alleged impossibility or the threats from anti-social elements, and upheld the termination of his contract as lawful.

Issues: Whether the contract was impossible to perform under Section 56 of the Indian Contract Act due to external threats and the validity of contract termination.

Ratio Decidendi: The court ruled that the plaintiff's failure to provide evidence for the claimed impossibility or notification to defendants about the situation meant he could not escape liability for breach, reaffirming the rule that one cannot self-induce frustration of contract.

Result: 2nd Appeal dismissed.

Table of Content
1. background of the case regarding construction contract. (Para 1 , 2 , 3)
2. defendants' contest to the plaintiff's claims. (Para 4 , 5)
3. issues framed for determination in the case. (Para 6 , 7)
4. trial court's findings and dismissal of the plaintiff's suit. (Para 8 , 9 , 10 , 11)
5. substantial question of law regarding impossibility under contract act. (Para 13)
6. legal principles encapsulating contract performance and frustration. (Para 15 , 16 , 17 , 18 , 19)
7. court's rationale for upholding lower court's decisions. (Para 20 , 21)
8. final order dismissing the appeal. (Para 22 , 23)

JUDGMENT :

A.C. Behera, J.

This 2nd Appeal has been preferred against the confirming judgment.

2. The appellant in this 2nd appeal was the plaintiff before the learned trial court in the suit vide C.S. No.184 of 2013 and appellant before the learned 1st appellate court in the 1st appeal vide R.F.A. No.46/20 of 2018-21.

The respondents in this 2nd appeal were the defendants before the learned trial court in the suit vide C.S. No.184 of 2013 and the respondents before the learned 1st appellate court in the 1st appeal vide R.F.A. No.46/20 of 2018-21.

3. The suit of the plaintiff (appellant in this 2nd appeal) against the defendants(respondents in this 2nd appeal) vide C.S. No.184 of 2013 was a suit for declaration and mandatory injunction.

As per the case of the plaintiff, he(plaintiff) is an A-Class Contractor and he being the highest bidder of a tender in respect of the Government works indicated in Schedule-A of the plaint under Subdega Block in the district of Sundargarh, a work order in respect of the said works was issued by the defendant nos.1 and 2 in his favour. Then, as per the agreement, the defendant nos.1 and 2 received security money from the plaintiff for such work order in the form of original Bank guarantee described in Schedule-C of the plaint for completion of the said works within the period indicated in the work order and agreement.

On the basis of that work order and agreement, he(plaintiff-Contractor) started its works at the work site and the said work site is under Subdega Block of Sundargarh district was within two to five kilometers distance from Jharkhand border. While, works at the work site by the plaintiff was under progress, some anti-socials of Jharkhand province interfered with his works at the work site and demanded crores of rupees as chanda/dadabati from the plaintiff or else they will not allow him(plaintiff) to continue with the works there. As such, the Maoists as well as Pahadi Chita Group anti-socials created disturbances at the work site coming to the work site physically on being armed with weapons and threatened to the engaged workers of the plaintiff to stop the works expressing that, unless the plaintiff comply their demand of money, they will not allow them to work at the work site. They also threatened to the workers of the plaintiff at the work site to commit murder, if they will proceed with the works. One day, in the year 2009, the Maoists kidnapped to the nephew of the plaintiff, namely, Jatin Naik from the work site during the course of his supervision to the works and demanded lakhs of rupees from the plaintiff for his release. For which, the plaintiff lodged an F.I.R. on dated 27.08.2009 at Talasara Police Station and on the basis of such F.I.R. of the plaintiff, a case vide Talasara P.S. Case No.70 of 2009 was registered, but, the police could not able to rescue the nephew of the plaintiff from the clutches of the Maoists. Therefore, the plaintiff was compelled to satisfy the demand of the Maoists for the release of his nephew from their clutches and on payment of rupees ten lakhs to the Maoists, he(plaintiff) could able to release his nephew from the clutches of Maoists. Due to the above continuous interference of the Maoists and anti-socials in the work site of the plaintiff, the works of the plaintiff could not progress, which ultimately made the said works at the work site impo

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